Who's Making Money

The CNN Washington Bureau’s morning speed read of the top stories making news from around the country and the world.

WASHINGTON/POLITICAL

For the latest political news:  www.CNNPolitics.com

CNN: Obama to lay out new economic plan Wednesday

With less than two months to go until a critical midterm election likely to turn on the economy, President Obama this week will lay out a new plan that includes a proposal to extend a tax cut popular with the business community, according to an administration official.

CNN: Democrats defend state of economic recovery

As the summer begins to wind down, Republicans are criticizing Democrats over economic promises they made at the beginning of the season. Democrats had dubbed it a recovery summer, but critics were taking aim at some economic indicators that didn't show much forward progress.

CNN: McCain wants Obama to visit border

Republican Sen. John McCain on Sunday invited President Barack Obama to visit the border with Mexico to get a complete picture of the region and called on the president to do more for security.

New York Times: For G.O.P., Tea Party Wields a Double-Edged Sword

So far this election season, the Tea Party has brought a huge amount of unexpected energy into the campaign, and it could drive sufficient Republican turnout to become a major and perhaps decisive factor in many races. But the movement has also forced Republicans to spend precious time and money on primary races they should have won easily and has produced some inexperienced candidates who have stumbled in the early going.

Politico: Dems run away from health care

A handful of House Democrats are making health care reform an election year issue — by running against it. At least five of the 34 House Democrats who voted against their party’s health care reform bill are highlighting their “no” votes in ads back home. By contrast, party officials in Washington can’t identify a single House member who’s running an ad boasting of a “yes” vote — despite the fact that 219 House Democrats voted in favor of final passage in March.

Politics Daily: Republicans Headed for Big Pick-Up of Governor's Seats This Year

Democrats currently hold a slight majority of the nation's governor's seats but that balance of power is likely to shift dramatically after this year's midterm elections, according to a new forecast.

Politico: GOP gov hopefuls run against Obama

They’re all Rick Perrys now. A year and a half after the governor of Texas energized his reelection campaign by casting himself as an antagonist to President Barack Obama, Republican gubernatorial candidates across the country are following his example.

Los Angeles Times: 4 campaigns, each with its own distinct style

Republicans Whitman and Fiorina and Democrats Brown and Boxer bring different levels of wealth, history and intensity to their races in an unpredictable year.

Lexington Herald-Leader: Coal a 'driving factor' in U.S. Senate race

The landscapes of Eastern and Western Kentucky have little in common, but the areas share at least two things: an abundance of coal and a pivotal role in the U.S. Senate race.

CNN: Clinton to make Middle East trip

Secretary of State Hillary Clinton will travel to the Middle East on September 14 to participate in a second round of peace negotiations between Israel and the Palestinian Authority, according to a senior State Department official.

NATIONAL

For the latest national news:  www.CNN.com

CNN: American Muslims nervous about Ramadan's end coinciding with 9/11

For Muslims, the end of the holy month of Ramadan is typically cause for celebration, with three days of feasting and socializing after a month of daytime fasting. This year, though, many American Muslims are greeting Ramadan's end with a measure of worry, as the holiday coincides with the anniversary of the September 11, 2001, attacks.

Los Angeles Times: For many unemployed workers, jobs aren't coming back

The U.S. economy will eventually rebound from the Great Recession. Millions of American workers will not. What some economists now project — and policymakers are loath to admit — is that the U.S. unemployment rate, which stood at 9.6% in August, could remain elevated for years to come.

Indianapolis Star: Even in this economy, some jobs are in demand

The unemployment rate is 9.6 percent, with nearly 15 million Americans looking for jobs; yet some industries are desperately seeking qualified workers to fill positions that have been vacant for months.

Detroit News: New health reform measures start

More health care reform measures are kicking in, with many of them taking effect this month. While Michigan's major insurers say the changes will have little, if any, impact on health care premiums, analysts say consumers can expect insurance rate hikes eventually.

Washington Post: US may stop cyber attacks at source

The Pentagon is contemplating an aggressive approach to defending its computer systems that includes preemptive actions such as knocking out parts of an adversary’s computer network overseas — but it is still wrestling with how to pursue the strategy legally.

Denver Post: Spoiled system: Eating healthier comes with a price for families

As Revisha Martinez pondered the cost of peaches and watermelon at her local King Soopers recently, she became the last stop in a complicated food-production system that critics believe has turned healthy eating into expensive eating.

INTERNATIONAL

For the latest international news:  http://edition.cnn.com

CNN: U.S. military helps repel suicide bombing attack, official says

U.S. military personnel were involved in repelling a suicide bombing attack Sunday on an Iraqi military base in Baghdad, four days after the United States officially ended its combat operations in Iraq.

CNN: Sources: As many as 2,000 more troops may be going to Afghanistan

As many as 2,000 additional troops - including a number of U.S. forces - may be headed to Afghanistan in the coming weeks under a plan being proposed by Gen. David Petraeus, CNN has learned.

BBC: Boat accidents in DR Congo claim 'many' lives

Many people are feared dead in two separate boat accidents in the Democratic Republic of Congo. One of the boats was carrying up to 300 people when it caught fire on the Kasai River near the Angolan border.

CNN: Israel's Netanyahu offers regular talks with Abbas

Israeli Prime Minister Benjamin Netanyahu has offered to meet Palestinian leader Mahmoud Abbas one-on-one every two weeks to discuss "the agenda for a peace agreement," he said Sunday.

Los Angeles Times: North Korea Workers' Party meeting raises speculation

Secrecy abounds ahead of the first party congress in decades. Experts expect it to set the stage for officially naming the ailing Kim Jong Il's successor, said to be his youngest son.

CNN: Indonesians protest U.S. church's plan to burn Quran

Thousands of Indonesians gathered Sunday outside the U.S. Embassy in Jakarta to protest a Florida church's plan to burn copies of the Quran. The Dove World Outreach Center in Gainsville, Florida, plans to mark the ninth anniversary of the September 11 attacks by burning copies of the Muslim holy text.

CNN: Plan C for Chile mine rescue: Use oil drill

Hedging their bets, officials in Chile said on Sunday they will set up an oil drill as a third option to rescue the 33 miners trapped underground since August 5. The idea, which is Plan C, could be the fastest of the three options currently underway. However, the drill needs to be transported first from Iquique, a city in northern Chile, and then installed.

CNN: Basque separatist group announces cease-fire

The Basque separatist group ETA released a cease-fire statement Sunday to various media, including the Basque newspaper Gara, where it typically releases information. ETA has announced cease-fires before and broken them, notably the unilateral 2006 cease-fire that was announced as "permanent," only to be broken months later with a car bomb at Madrid's airport that killed two people.

BUSINESS

For the latest business news:  www.CNNMoney.com

CNN Money: 81% rate U.S. economy as 'poor' – CNN poll

A new national poll released Sunday indicates that eight in 10 Americans say that the economy is in poor shape, and the number that say conditions are very poor is on the upswing after steady declines through the spring. And according to a CNN/Opinion Research Corporation survey, more people blame the Republicans over the Democrats for the country's economic problems.

CNN Money: Wall Street faces an economy at a 'crossroads'

Stocks started September with a bang as investors cheered a rare dose of good economic news but investors may need to buckle in for the coming week: It's a holiday-shortened week with little on the docket to set the tone.

New York Times: Grim Housing Choice: Help Today’s Owners or Future Ones

The unexpectedly deep plunge in home sales this summer is likely to force the Obama administration to choose between future homeowners and current ones, a predicament officials had been eager to avoid.

In Case You Missed It

CNN's Candy Crowley talks about the critical reaction to the renovated White House Oval Office.

http://www.cnn.com/video/#/video/politics/2010/09/05/sotu.oval.office.fluff.cnn

The heads of the AFL-CIO and the National Small Business Association give their take on the state of the U.S. economy.

http://www.cnn.com/video/#/video/politics/2010/09/05/sotu.mccracken.trumka.int.cnn

Subscribe to the CNN=Politics DAILY podcast at http://www.cnn.com/politicalpodcast

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Washington’s latest bailout of bleeding state governments, $26 billion worth, has gotten attention because, among other things, almost half the bailout is financed by cutting $12 billion from food stamps.

But isn’t food stamps a signature program for the liberal Democrats who passed this spending bill? Isn’t government money for the poor what Democrats are supposed to be about?

How, in these tough times, do Democrats who control congress decide who’ll get funded and who not?

This is the latest example, particularly illustrative, showing that Washington is less and less about ideas and values, and more and more about interests, power, and money.

In this case, we’re talking about unions. Of the $26 billion the bill appropriates, $16 billion goes to state Medicaid programs and the other $10 billion to unionized state and local government employees.

Of the top twenty PACs in the country, eleven are union PACs. Number eight on the list is the American Federation of State, County, and Municipal Workers ($1.8 million dollars in campaign contributions in the current election cycle). Number seventeen on the list is the American Federation of Teachers ($1.5 million in contributions).

Needless to say, around 100% of these union political contributions go to Democrats.

Union membership today is mostly a government phenomenon.

Whereas 7% of private sector employees are unionized, 35% of government employees are.

So with each incremental growth in government, unionized workers gain disproportionate power and influence over all our lives. Unions understand that big government is their bread and butter, so unions, that represent 15% of all American workers, account for more than 50% of the nation’s largest Political Action Committees.

The problem should be clear. Regardless of the narrative you want to use to explain how we got into the current difficult economic times, there is only one way out. That’s flexibility, creativity, and innovation.

But in areas that are unionized – mostly government – we hit the wall. Union contracts prohibit wage adjustments or any kind of market flexibility.

Over the last ten years, wages have risen for state and local government workers by 19% compared to 9% in the private sector.

Nobel laureate economist Gary Becker writes: “During this recession, wages did fall for many workers, but mainly among non-union workers….For example, the state of Illinois has the largest fiscal deficit as a percent of its budget of any state… It required many of its high level non-union employees to take 24 unpaid leave days, or about a 9% cut in their salaries, since the state government cannot touch the wages of their many unionized employees.”

Regarding pleas about saving teachers’ jobs, it’s not about this at all. It’s about teachers’ unions refusing to make concessions and hard adjustments like all Americans are making.

Steve Moore of the Wall Street Journal recently wrote about the refusal of the teachers’ union in Milwaukee to negotiate with the local school board and make any concession in which teachers would have to contribute something to their health plan. Their plan, according to Moore, costs taxpayers $26, 844 per family, compared to $14,500 which typifies private employer plans.

The union held out, letting some teachers get laid off, waiting for bailout from Washington.

Priorities in Washington have always been influenced by who’s got the money as opposed to who’s got the ideas. Today mores than ever.

And for the poor?

The main way to end the poverty cycle is to get poor children educated. And it’s the teachers’ unions that fight school choice.

A major driver of poor youth unemployment is the minimum wage, aggressively supported by unions.

But unions have campaign funds. So they will step ahead of the poor in line when Washington sets priorities. This will be true whether it’s a question of funding existing programs for the poor, like food stamps, or pushing forward innovative market based ideas to combat poverty.

eric seiger

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